European shares up as Cypriot banks reopen

EUROPEAN stock markets have climbed and the euro has recovered versus the US dollar as Cypriots showed calm when their banks reopened and traders prepared for a long Easter weekend as the first quarter draws to a close.

At close in the last session before the Easter break, London's FTSE 100 index of leading companies rose 0.38 per cent to 6,411.74 points on Thursday.

In Frankfurt the DAX 30 edged up 0.08 per cent to 7,895.31 points, while in Paris the CAC 40 climbed 0.53 per cent to 3,731.42 points.

Madrid gained 0.25 per cent, but Milan fell 0.10 per cent in choppy trade amid continued political uncertainty in Italy.

"The market is being carried by banking shares that have suffered recently," said Renaud Murail of Barclays Bourse.

With the holiday weekend approaching, "the market is gradually digesting the consequences of the Cypriot bailout and political impasse in Italy", Murail said.

Firmer confidence in the eurozone also boosted Wall Street, where the widely watched S&P 500 pushed past its record closing high.

More than an hour into trade, the S&P rose past the previous closing high of 1,565.15 set on October 9, 2007.

The index has threatened to break the old record for weeks after the Dow Jones Industrial Average broke its 2007 record last month.

But in midday trade, the S&P was off the session high at 1,564.96 points.

The Dow Jones Industrial Average was up 0.23 per cent to 14,559.57, and the tech-rich Nasdaq Composite edged up 0.05 per cent to 3,258.05 points.

Stocks markets have risen solidly since the start of 2013, largely thanks to a slowly improving US economy and some better European economic data.

The London stock market has risen 8.71 per cent since the beginning of January, Frankfurt by 2.40 per cent and the CAC 2.48 per cent. Madrid, though, has fallen three per cent.

The recovery in equity prices comes as the world's biggest economies are slowly recovering from a 2012 slowdown, the OECD said in a near-term of assessment of G7 nations on Thursday.

Japan and the United States were leading the way, ahead of a struggling two-speed eurozone, the Organization for Economic Development and Co-operation said.

But emerging economies were tipped to remain by far the strongest growth performers, with China expected to expand by well more than eight per cent in the first half of 2013.

The OECD forecast that the full Group of Seven (G7) most industrialised economies, which does not include China, will grow by 2.4 per cent in the first quarter of this year.

But the OECD warned new-found buoyancy on financial markets had yet to feed through to the wider economy, especially in the eurozone.

In foreign exchange deals, the euro recovered to $US1.2820 from $US1.2776 late in New York on Wednesday. The European single currency had on Wednesday fallen under $US1.28 for the first time since November.

Gold prices on Thursday edged down to $US1598.25 an ounce from $US1603 Wednesday on the London Bullion Market.